The $2.4 billion was taken from the
$787 billion USD economic stimulus bill and provided $1.5 billion
directly to automakers, $500 million for companies that build
electric vehicle components, and another $400 million for research
and infrastructure. This is in addition to up
to a $7,500 tax credit that is available to those who purchase
plug-in hybrid vehicles.

However, despite all of the money being
thrown at the electric vehicle industry, the payback for consumers is
continually being questioned. The latest backlash is in a new study
coming from the Boston Consulting Group (BCG) according
to the Detroit News. The report suggest that consumers
won't see a payback for the energy/fuel savings of all-electric
vehicles for roughly 15 years. The upcoming Chevrolet Volt, however,
fares even worse -- according to the BCG, the payback timeframe for
the vehicle is a whopping 19 years.

The main reason for the disparity is
battery technology. Advances in battery technology to provide greater
range for vehicles have not come fast enough. Likewise, the
astronomical price tag of batteries used in vehicles like the Tesla
Roadster and Chevrolet Volt won't be coming down to more acceptable
levels anytime soon.

Even more troubling is BCG's assertion
that a 15-kWh battery pack which costs $16,000 today will still cost
a hefty $6,000 ten years from now. BCG suggests a number of things to make
electric vehicles more palatable to the U.S. consumer with two of
the more outrageous options being a 210 percent increase in the gas
tax or oil prices skyrocketing to $375/barrel.

And it's not just BCG that is
predicting doom and gloom for the electric vehicle industry.
DailyTech reported in late December that the National Research
Council (which is funded by the U.S. Energy Department) also didn't
have too many kind words to say about the feasibility of electric
vehicles. In addition, the relatively small $2.4 billion that the
Obama administration has already funneled into the electric vehicle
market would have to be expanded to hundreds of billions of dollars for
the vehicles to proliferate in the marketplace.

With both of these studies coming to
the forefront within weeks of each other, it's hard not to look back at
comments Audi of America President Johan de Nysschen made in
September 2009. He commented on the Volt's high asking price,
stating, "No one is going to pay a $15,000 premium for a car
that competes with a (Toyota) Corolla. So
there are not enough idiots who will buy it."

With regards to pure electrics, he
added that they are "for the intellectual elite who want to show
what enlightened souls they are." More recently, de Nysschen
commented that "paying
customers to drive your cars is not sustainable," in
reference to the aforementioned $7,500 tax credit.

Makes you wonder...big oil has big pockets and many lobbiests. With a lot to lose if electric picks up, it's pretty obvious who funds these studies (including the department of energys' predictions)

And sure, a lot of people will argue our electric grid isn't completely nuclear (far from it) but keep in mind that it is mostly solid fuels and those come from 'here' (and are not considered part of the oil industry.)

It won't be any different with the Volt. Regarding the high cost and still relatively short range of the battery, expect development to be quicker than what is predicted today. Advancements in technology are occurring at a logarithmic, not linear, rate. DailyTech has already posted news stories about scientists improving batteries with sulfur or zinc, increasing power up to 3 times.

Ten years is a long time to attempt to make predictions. Expect scientific developments to occur faster than are being stated in today's scientific journals.

You really need to do some research before just saying something you think is true as facts. The buyers of the Toyota Prius have not received a tax credit for years. Once a vehicle hits over 100k sales, it is eliminated from the program as the program served its purpose to help boost sales of said vehicle.

Most of Ford's hybrids will be disqualified from the hybrid program this year because they have sold so many.

quote: Credits for Toyota and Honda hybrids no longer qualify at all for tax credits. Ford hybrids are still eligible, but the credits were cut in half from amounts listed above starting April 1, 2009. In October 2009, the credits were cut in half again, and will completely phase out on April 1, 2010

quote: The new qualified hybrid motor vehicle credit begins to phase out in the second calendar quarter after the calendar quarter in which at least 60,000 of the manufacturer’s qualifying passenger automobiles and light trucks have been sold

All right, sure. Irrelevant to the point that the popularity of the Prius was artificially inflated by tax credits, and as such asserting that its popularity is due solely to consumer choice is a phony statement.

quote: and as such asserting that its popularity is due solely to consumer choice is a phony statement.

Wrong, since 2007 it continues to be sold out and still the #1 selling hybrid and vehicle in several countries. If you don't like the car don't buy it but don't go around make silly comments simply because you don't like the car.

Why bother posting about the Prius in Japan? Hybrids in Japan are completely tax free. No to mention their own version of a cash for clunkers program. High mileage, no taxes, free money for your old car, higher cost to keep around your older car, make sense what to get.

Also did you just cite the stupid Ford Explorer article? Even without the Prius around, the Explorer was dying out anyways. Pretty much started happening when your smaller SUVs and CUVs started coming out and gas prices skyrocketed.

But how about putting a tax on oil to account for how much we spend safeguarding our 'allies' in the Middle East. And add in the cost of lives too. The US Government has invested Trillions in supporting oil.

Regardless, the Prius has become entrenched due to tax credits. One cannot say that consumer choice was the primary factor when there's an artificial factor skewing the results. Thus the assertion under contest was incorrect, at at least horribly incomplete.

How does a vehicle become "entrenched" due to tax credits once the tax credits are removed. Please do go on! The tax credits served their purpose to nudge vehicle sales. The tax credit had no effect on the hundreds of thousands of Priuses sold since it has been removed.

The reason the Prius is "entrenched" is because people want to buy the car. It would not be around if people didn't buy it, tax credit or not.

Really? Let me me dumb it down for you. The Prius sold on its own, not because of the tax credit. The Prius is successful by itself, not because of the tax credit. The Prius has sold hundreds of thousands YEARS AFTER any form of tax credit was available. The past few years, many people paid MORE than the car's MSRP, not because of a tax credit (there was none) but because they wanted the car.

No, you are stating that it was a strong and leading factor. In fact, it was a minor one. The car would not sell so well today if the tax credits meant much. The car would not sell a HELL OF A LOT MORE TODAY compared to several years, when the tax credit was in effect, clearly shows the car sells on its own.

So in summary, you are wrong that the Prius currently receives a tax credit, you are wrong that a new tax credit will be implemented on the Prius, and you are wrong that the tax credit had a significant impact considering that many of the Priuses were sold over MSRP and the sales continue to increase even after the tax credit was removed.

quote: Then why was there a tax credit in the first place ? Maybe while you are "dumbing" things down for me, you should actually educate yourself on what a subsidy is.

It was there to help spur sales which the Prius did not need. Your point?

quote: We'll never know, will we ? To say the credit had NOTHING To do with sales would contradict the point of a tax credit, would it not ?

Yes we do know, the past 3 years are proof that the tax credit was meaningless. Not only was there no reduction, there was an acceleration of sales. That speaks volumes. And I NEVER said it did "nothing."

quote: Because it's an established product NOW. When it was new and different and overpriced, and consumer confidence in it was low, ENTER THE TAX CREDIT. Do you get it ?

When was it overpriced? The Prius has a higher MSRP now than it did when it was released. Oh, and it's established because PEOPLE DEMANDED THE PRODUCT, not because of the tax break.

Dizzying intellect. So the tax credit didn't matter, but it matters when it's convenient for your argument, then it doesn't matter when it's good for mine.

You, sir, are amazing. You can both turn a blind eye and stare into a crystal ball with your other.

quote: The Prius has a higher MSRP now than it did when it was released.

Since when has the MSRP of ANY vehicle gone down from year to year? Cars get MORE expensive, not cheaper dumbass.

quote: Oh, and it's established because PEOPLE DEMANDED THE PRODUCT

If there was a huge demand they would have been willing to pay full price without government subsidies. And, by the way, the sales of the Prius compared to non-hybrids in it's class aren't exactly stellar. You're making it seem like a top seller.

What the hell are you talking about now? I never said that the tax credit mattered. You are putting your crap in my mouth, stop making up stuff.

You were the one that said the Prius was overpriced as though the tax credit help gap the difference of new technology. You were the one that made the argument as though the first Prius was a fuel cell vehicle that was cost prohibited to make and sell. I never said that the MSRP would go down, but was using your stupid argument to make a point.

quote: If there was a huge demand they would have been willing to pay full price without government subsidies. And, by the way, the sales of the Prius compared to non-hybrids in it's class aren't exactly stellar. You're making it seem like a top seller.

Are you such a fucking idiot? Like I before, THEY DID PAY MORE THAN MSRP. They were willing to pay more. The tax credit would have done little to affect these sales. Why would you pay $3k-$4k over MSRP? Because of the fucking tax credit? LMAO@youdumbass.

I bet you once the costs for the Volt battery go down, you'll see the same thing happen in 3-5 years. Huge sales of the Volt. The sales will get bigger every year like HDTVs did after a few years of being on the market.

A $27,000 2011 Volt (after federal/state tax credits) is a very compelling car considering all the gas savings, HOV access, low or no vehicle taxes, low or free charging for some public charging stations, low or free charging at work if the company wants tax benefits, etc.

A 2011 Prius with a decent option package costs about $26,000 you know. Why not just get a Volt for just a little more and be able to drive around using NO gasoline most of the time? You can laugh at the suckers who have to pay $4/gallon in a few years. You know it's going to happen. It's just a matter of how soon.

The Federal and Local governments are going to give an UNFAIR advantage to cars like the Volt ... as they SHOULD! Why? Because like former oilman GW Bush said in the "State of the Union" a few years ago ... " WE'RE ADDICTED TO FOREIGN OIL " !!! It's a security issue, a military issue AND an economic issue.

It sounds like some of the above posters are talking about the Volt and not the Prius. The tax breaks on the Volt will drive those sales exponentionaly more than the Prius. Imagine after a couple of years the Volt is disqualified because they met the 60k sales quota and they have to sell the Volt for $40k. Who will buy it?

The U.S. Congress has already definitely passed a $7,500 tax credit for the Volt. That makes the 2011 Volt around $32,500. However, GM is hinting that the Volt's $40,000 price will be lower ... maybe a good bit lower. That could bring the price for the Volt down to around $30,000 ... maybe more.

Then, there's the state level tax credits. States like Texas, Colorado, California and others are likely to have these for a certain number of Volt sales. That would bring the price of the 2011 Volt to maybe $25,000. That would be awesome.

Who knows? There might even be another big "Cash For Clunkers" thing in 2011 that could lower the price even more.

Bottom line, the Volt needs to just get through the first couple of years of production so they can get their battery factories built and optimized. Once they do that, the battery prices for the Volt should come way down. They are already saying by 50%. Others are saying maybe 75% in 3-5 years. Once that happens, the Volt should be somewhat affordable even without tax credits.

The Volt is always going to be considered a "premium green car" though. You simply get more electric car than you get with the regular Prius. The Volt's wheels are always driven by the electric motor ... unlike the Prius. It's just more efficient. The IC engine for the Volt just makes electricity like one of those Honda generators that people use as emergency power. The IC engines for future Volts should be super efficient, lighter, and smaller.

You pay for 2 cents a mile for the first 40s miles and then the IC engine kicks in. Even after 40 miles, you should be getting around 40+ miles per gallon. The key to saving money with the Volt is to plug it in every chance you get. At home, at work, the mall, etc.

Anyways, I'd personally rather have my car now. Right now I'm getting around 30 mpg, can work on the car myself, low insurance, and all paid off.

15 extra mpg by having to charge my car off the power grid. I don't see much savings there. Even in the future, when gas does go up. Cause if gas goes up, everything else goes up. The cost to ship coal to our electricity plants, means higher electricity costs.

Until we have a cheap, renewable energy source that doesn't pollute, getting a hybrid means a whole lot of nothing.

If hybrids/plug-in electrics take over, we'll just be screaming ,"We're addicted to foreign coal."

Huh. I was wondering the same thing as I read this. Obviously everything has it's place. As we (try) to move away from gas, many alternates are going to come into play. What works for my family's lifestyle won't work for another's.

I want to see the actual math on the payback time, as another commenter was questioning as well.

Electricity isn't a solution; we need more power plants, the infrastructure is a mess as it is, and its too expensive to store.

Hydrogen Fuel Cells got us to the moon, the tech is tried and tested, and it is simpler/cheaper to produce. The only disadvantage is the underlying structure (IE: Gas Stations) need to be re-worked. [Plugging in is more convienent and ready]

Hydrogen fuel cells are popular for space applications because that industry is highly weight-sensitive (costs on the order of $15k per pound to get something into orbit). Pure hydrogen packs a lot of energy for the weight.

Terrestrial applications are not as weight-sensitive. So paradoxically the people working on hydrogen fuel cells are coming back full circle. First they looked into storing pure hydrogen, then storing it as compressed methane, then as liquid alcohol. They're one step away from storing the hydrogen in the form of gasoline and diesel. (The fuel cell would still be more efficient since it doesn't have to deal with the temperature limit on thermodynamic efficiency.)

You didn't read the article BCG (I don't know who funded them) and US Department of Energy (Funded by US tax payers). Regardless of who funded BCG they came to a similar conclusion to the DOE study validating the conclusion.

You all seem to miss the point. These studies are based on purchase price AND operating costs. They are figuring out how much an owner will have to pay under normal use. I don't know about you but I don't have room in my budget to add to my vehicle operating costs. Even with a 210% increase on gas prices EVs are still too expensive.

For those in denial; this is what happens when the government thinks it knows best. When this happens you get Trabants, Ladas and Zil limos. If you want clean vehicles let private industry figure out what products work and people will buy, not politicians. Government has a part by setting proposed standards, i.e. emissions, energy usage goals, size, and crash worthiness. BUT NO MORE.

Lawyers are clueless when it comes to cars, go look up the Ralph Nader safety car and you'll see what I mean.

Look at the RAV4-EV and ask why we don't have this car on the market (roads) right now. The design worked ten years ago, the technology worked ten years ago, yet somehow EVs remain just and unavailable around the corner as they have for the past 20 years. I have heard and read a story that GM sold the battery patents to Chevron who locked them up so that the NiMH couldn't be built in large formats for EV propulsion. Anyone care to clarify?

Actually, if you read up on the historical impetus for the EV-1, I think you'll see a much simpler explanation than all these conspiracy theories about battery patents and big oil colluding with auto manufacturers.

California passed a law requiring x% of all vehicles sold by manufacturers to be 100% emission-free by a certain year. Most manufacturers piss and moan about it. GM sinks $billions into R&D and actually builds an electric car.

Toyota, and other car companies lobby California to change the law, arguing that its technologically unfeasible to meet the zero-emission requirement by the target year. They present their gas-electric hybrids as evidence that they are working towards lower emissions vehicles in good faith, and that the zero-emission requirement is unnecessary.

California waffles, then delays the zero emission requirement for a few years, then drops it entirely. GM, which along with Honda had the only operational fully-electric mass production vehicle at the time, is livid. They'd complied with the Calif. government's law in good faith, invested billions in R&D, and were on the cusp of dominating the auto market in California. Other manufacturers without an electric vehicle would be prohibited from selling regular cars in California since they couldn't meet the zero emissions requirement. They would either have to spend years developing their own, or license from GM in order to continue selling regular cars in California. Then the government pulls the rug out from under GM at the last moment and eliminates the requirement, thus destroying the financial viability of the product, as well as any chance for GM to recoup its research investment. In a fit of spite, GM destroys all its EVs and sells off the technology.

Actually, this is a pretty good case study on why it's bad for the government to get too involved in market manipulation. In order to be successful, such manipulation has to be consistent. But politicians are rarely consistent, flip-flopping in reaction to the slightest shift in the political winds and lobbying dollars.

My Dad, a clean vehicles proponent for Long Beach Ca, had an EV1 for a week. He found traveling more than 40 miles without a charging station you would needed to find another car. You had to think about how far you were going, how long you were going to be there, and was there an available outlet and sufficient time to recharge it. That's a lot to do just to go somewhere. He's not or has ever been an oil company spokesman or pushing an agenda other than clean transportation.

Also, the EV1 WAS NOT a production vehicle and DID NOT meet all crash safety standards. It was a developmental prototype that used a loophole in the law to develop cars on the public roadways without crash testing. Which is why they were only leased not sold.

To put the EV1 into production would have required a lot of engineering and would have added weight and reduced its range. The range BTW was based on perfect conditions to get that 100 mile range. Turn on the defroster, heater, or A/C and you quickly started to reduce its range.

Finally you chose to bash a small piece out of context. I said the government had a role by setting standards and goals. Politicians have no business picking winners in the marketplace. If we wanted government to run the economy we would have a Politburo to think for us and tell us what we need and can have. BTW the Politburo failed.

"this is what happens when the government thinks it knows best. When this happens you get Trabants, Ladas and Zil limos. If you want clean vehicles let private industry figure out what products work and people will buy, not politicians."

No what happens is you get an industry that runs interference on new technology through large political contributions to keep new technology off of the roads and out of the hands of the consumer. LCD TV manufacturers want the new tech on the shelves so they can remain competitive and to keep the customer worried that they don't have the most up to date technology at home to watch SpongeBob or CSI. The car manufacturers represent a whole supply chain froms park plugs to muffler manufacturers to piston rings that will very quickly fade away if the average commuter car switches to battery power. The auto industry is using the perpetual promise of a hydrogen economy, the fuel cell and the battery powered car so we will continue to think that EV technology isn't quite ready yet - but the automakers are working on it. What's to work on? You produce a RAV4-EV and as battery tech improves you retrofit/upgrade the batteries to gain more range or power. What I don't want to see from the automakers are more spacey sci-fi looking vehicles. Give me a 1st Gen CR-V or an Opel/Saturn Astra that run around ONLY on battery power. Leave out the complicated booster engine ala Volt and put in a few more batteries. 60 miles range would take car of most everyone's commute that I know except for a couple of people that drive 100 miles each way to work (why drive so far???).

Okay let's look at the costs. A $30K vehicle getting 18 mpg at $4 per gallon of gas costs about $30K (purchase price) plus $50K in gasoline. That's $80K to drive this vehicle for 200K miles. I won't even try to quantify the cost of tires for a large vehicle, maintenance, or repairs b/c they vary so much. I will however assume that the vehicle is worth very, very little at the end of the 200K b/c the tranny and the engine are well worn. Just check out the Clunkers from last summer and their end values - less than the gov't vouchers.

An EV might cost $40K after the tax rebate and then because they generally cost 1/6 of the cost of gasoline to operate that's another $8300 roughly for the electricity to drive 200K miles. We're up to $48,300. Figure in a $6K battery and we're up to $54,300. Assuming the EV has the RAV4-EV Panasonic battery proven to last over 100K miles (and over 150,000 miles in some cases) - you shouldn't NEED another battery. Even if you do that brings the total to ~$60K.

Now consider that this vehicle doesn't have a transmission or internal combustion engine to wear out. You might need a bearing or two. Most commercial electric motors ought to last many hundreds of thousands of miles. All the owner really has to worry about is rust or the vehicle getting "ugly" from neglect or wear. Or the manufacturer making maintenance and repairs unnecessarily expensive through flimsy parts or high prices.

No, I don't see how an EV can't pay for itself. Over the first 100K miles sure - it's expensive. So is vehicle ownership in general b/c of depreciation. As good as most vehicles are these days we ought to be looking at everything in 200K mile chunks b/c most vehicles are capable of this unless your area has serious corrosion issues.

What are you driving there boss?? 18MPG, unless your driving an SUV, truck or Minivan, your short by about 10 MPG. Heck, go buy a VW TDI and get 40+ MPG, even if you go with something similar in size like a focus or a fusion your looking at 30+ MPG.

I still agree completely hybrid vehicles are not economically feasible and really there is no benefit to them environmentally at this time.

As the other post said, people aren't choosing between an EV and an SUV. They're deciding between an EV and a similar car, so that's what you need to compare against. Using your logic, I could compare my current car's fuel consumption to an M1A1 tank, and conclude that my current car has already given me 99% of all the fuel savings I could potentially get, so there's no need to get something more fuel-efficient.

So take a $25k econo-sedan getting 40 mpg at $3 per gallon. Average person drives 12k miles a year, so that's $900/yr in fuel costs. Add in 4 oil changes and misc. maintenance to arrive at $1500/yr.

Your cost for the EV was $40k. It should actually be more since you need to factor in the cost of the tax rebate (it is not free - it is paid for by all citizens in taxes), but let's go with your lower figure. A Volt will go 40 miles on 8 kWh, which @ 12 cents/kWh = 2.4 cents per mile. If you replace the $6k battery at 150k miles, that's an additional 4 cents per mile. For a total operating cost of 6.4 cents per mile. At 12k miles/yr that works out to $768/yr.

$1500/yr vs. $768/yr is a net savings of $732/yr for the EV. The difference in purchase price was $40k - $25k = $15k, so it would take the EV 15000/732 = 20.5 years to pay for itself.

quote: I will however assume that the vehicle is worth very, very little at the end of the 200K b/c the tranny and the engine are well worn.

For small econo cars maybe, but for the bigger vehicles that get the 18mpg you speak of like the 96F150 that I drive that isn't true. I have 205k miles on my at 14 years old and I put all of them on it myself. I had to change the waterpump because my gf happened to put that orange goo antifreeze in it by accident, but otherwise only standard maintenance. I change the oil every 10k miles with synthetic and I still have no signs of engine wear. It has not been babied or garage kept, if it had it would look even better.

I want to see what shape the average Volt is in when it is 14 years old and has 200k+ miles on it. Also since my vehicle is in good operating shape, to replace it solely on fuel savings I would need to buy a Volt with $80 per month payments, I doubt the price will come down that much.

You chose to bash a small piece out of context. I said the government had a role by setting standards and goals. Politicians have no business picking winners in the marketplace. If we wanted government to run the economy we would have a Politburo to think for us and tell us what we need and can have. BTW the Politburo failed.

You and many others also ignore the vehicle safety laws. You cannot take any old vehicle swap the parts and meet safety standards. Batteries of any kind connected for this use pose a serious hazard in a vehicle accident. Look how quickly F1 dumped hybrids. It's not about replacement parts its about real world use and end costs. EV cars haven't reached the tipping point to replace gas. Also the power grid is at a critical point in many areas making EVs useless if you can't charge it.

I'm not against EVs they haven't proved themselves as a practical replacement.

I was wondering that myself. I suspect this Boston Consulting Group is another bogus right wing entity like the Heritage Foundation. In case you don't know it, the Heritage Foundation is run by the same folks that are behind the John Birch Society.

Totally irrelevant, they came to a similar conclusion to the US Department of Energy also mentioned in the article. Get your facts straight. Not everything on the right is automatically bogus the same way not everything on the left is pure and true.

I see two serious problems with this study that make it misleading but haven't yet been expressed in the comments.

The first one is so obvious I'm surprised nobody mentioned it until now. This study is trying to calculate payback times that are in the range of the decade. Since these payback times are based on electricity and fuel consumption by the various vehicles they study, they also need to forecast fuel and electricity costs for the next decade or two.The problem is that I seriously doubt these people are capable of making any kind of realistic forecast for these figures which in turns makes all their other calculations look kind of dubious.

The second problems lies in the way this study seems to assume that the only reason a person would buy an hybrid is cost efficiency. Obviously, the main goal of an hybrid is to reduce carbon emissions not to save money. At least that's the reason why they were built in the first place. It seems extremely reductive to make it all about the costs when obviously this is not the only issue.

I'm sure there was a mean annual price increase considered in the gas forecast. This generally takes into consideration $/barrel and %tax applied.

As for the carbon emissions, you're right, people are generally blinded by the emissions a car saves. By that I mean they think they are being cleaner, but generally do not consider the emissions the factory exerts or the environmental costs of using batteries and other parts that are dangerous to the environment. These parts can't just be burned.

When factory carbon emissions and bi-product wastes are reduced to the point that electric cars, including hybrids, make the world environmentally cleaner, I will also embrace them.

It will cost you about 2 cents a mile to drive the Chevy Volt. Today's 24 mpg cars cost you about 12-14 cents a mile. The price of electricity will always be lower than gasoline. The price of the batteries on the front end is the problem. New, highly automated battery factories will be built and the costs of batteries will go down just like they have with HDTVs. Maybe a LOT more than these "experts" are predicting.

Maybe these "experts" are Wall Street oil analysts or traders and want to continue to be able to manipulate oil prices so THEY can prosper at the expense of America's driving public. All these Wall Street scumbags care about is THEIR bonus. That's about it.

The Middle East oil sheiks just want to continue to build their solid gold bathrooms, man made islands, indoor ski resorts in Dubai, huge 6 star hotels and buy new Bentleys every year. All paid for YOU ... the sucker at the gas pump.

Do the math yourself. On a strict fuel cost measurement, buying a Volt at $32500 (40k-7500 credit) will take you over 10 years to break even with a comparable car (such as Cobalt). It just does not make economic sense to buy the Volt unless fuel costs go up near $10/gallon or all of your trips are 40 miles or less.

Does it make sense to buy a new car? Even with all the repairs you can put on a 10 years old car, you would still have to spend $4000 A YEAR to bridge the price difference, including monthly payments and insurance costs. Why would you spend $20 000-$30 000 or more on something I can have used for $5000 and fix it as it come?A car is an expense, however you wanna calculate your ROI on it, it will never pay for itself. People don't buy new cars, because it will be cheaper on the long run. They want something reliable with the latest technology. If all people were looking for is the cheapest way to go from point A to point B, the only thing selling would be Corollas and Elantras. Yet people can justify paying 40 grands on a compact-sized 3 Series and G37. Or $25K for a Jetta because it's a TDI. It's all about personal taste and perception.

Congratulations, you've just stumbled upon the greatest marketing scam invented during the 20th century. Well, maybe second-greatest, after the diamond engagement ring.

You don't need a new car every 3-5 years. Most cars will operate just fine for 10, 15, even 20-25 years with good maintenance. The primary reason for new car models and car advertising is to get you to buy a new car well before the 10-15 year timeframe. Early on, auto makers realized that as their cars got more reliable, their annual revenue was going to go down as fewer people needed to buy a new car.

Then some brilliant marketer figured out that by changing the bumps and curves on the sheet metal/plastic covering the surface of the car, they could get people to spend a significant fraction of their income to buy something which they didn't need.

So true. I was amazed over the past 10 years or so how often people bought new cars and how many extra cars families had. I've always had the mind set that a car is simply a tool to get me from A to B. I had my first car (purchased in my name) for 9 years and only recently had to purchase another one. Thanks to the great housing bubble, people used their houses as cash machines to buy the new, hot car every few years.

Actually in 2008 we used about 7.14 billion barrels of oil in the United States (300 billion gallons BTW). So if by some miracle we were able to recover all of that oil in the Bakken Formation instantaneously it would still only last us barely 6 months. Not to mention that they are already getting oil from there. I think if you tried to extract it yourself you'd find it is not as easy as you seem to think it is.

Also we already extract 43% of the oil we use here in the US, so I think your conspiracy theories are out of whack with reality.

You miss the point ENTIRELY. We have this massive supply and should keep all of our money domestic to stem the flow of cash offshore. It will cost $16-17 per barrel to extract, oil closed yesterday at $82 a barrel. Do the math.

I know of one well in South Dakota that hit oil at 400 ft. They were drilling for water. So its not that hard to get to.

We then will have more available capital to work on cleaner sources of energy. When the government taxes us more to fund the politicians pet projects they remove massive amounts of money from the economy plus the bureaucracy handling fees stifling the private sector. BTW government wages recently exceeded private sector wages for the first time.

That doesn't include the massive natural gas reserves or coal gasification which becomes profitable with oil over $40 a barrel. Coal makes for a cleaner diesel and jet fuel source than oil.

This is where we get our transition energy source as we work towards finding a viable clean energy source(s). If only the politicians would come up with a better plan but they can't because current proposed clean energy isn't viable on an nation wide industrial scale.

CURRENTLY THERE IS NO VIABLE CLEAN ENERGY THAT CAN REPLACE FOSSIL FUELS EITHER TODAY OR WITHIN THE NEXT DECADE. If there were such an energy source we would be using it. The Government would have mandated it already.

I work 1.2 miles from my home, 5 days a week. I drive an extra ~160 miles a week for college, Costco, family, and misc. My fuel budget last year averaged almost $50/week and will rise this year to ~$60 so long as gas doesn't skyrocket due to a minor increase in both price and usage.

$60 x 52 = $3120/yr

A prius would, at most, use 50% as much gasoline. I think I use significantly less than the national average, and if I thought a new car (of any type) were worth the cost I would find a new Prius to be of even greater value. But my problem is that ALL new cars are not worth their cost. There's a huge deal of "style" and inefficient production costs involved in purchasing any new vehicle.

Even if I only kept the car for the duration of a 5-year loan I would save approximately $7800 in fuel, maybe a little less compared to other vehicle considerations I may make when shopping. If I keep it longer the ROI will increase.

So what am I missing? That all cars are a frickin' rip off and are infeasible for most people, but that was conveniently left out of the report?

Regardless, my "light" mileage makes even the unsubsidized Prius a better value than any other car in its class, and anything more expensive is out of the question for me anyway. So what was their point?

One reason that people overlook for why people will buy Chevy Volts is the same reason people buy an (impractical) Mercedes or a Corvette. The performance of the Volt is going to be impressive to a lot of people. It will go 0-60 mph in about 8 seconds. That's much faster than a Prius. The Cadillac Converj (with Voltec technology) will probably go 0-60 mph fairly close to the Tesla Roadster ... 0-60 mph in 5-6 seconds.

The Converj and the Volt have INSTANTANEOUS torque and acceleration. No gear shifts to slow things down. People are going to love that type of acceleration along with the library quiet and smoothness you get with an electric car. You'll feel like you are floating along in something really modern and innovative. There's no question that electric motor driven cars are what our children and grandchildren will be driving. Why not YOU? Why not get a taste of what future cars will be like in 2011?

The new CEO of GM said there's a decent change that GM will pay back all of the loans they got from the government in the next year or so. I bet GM goes public again in 2011 and it'll be one of the biggest IPOs ever ... especially if GM is solidly profitable by then.

GM cut a lot of costs during their restructuring. GMs latest vehicles are getting good reviews from organizations like Consumer Reports and JD Power you know. GM will probably be getting lots of good PR later this year when the Volt comes out. It might be available on a limited basis in August I hear and then for everyone in November.

Agreed on the additional torque and acceleration of EVs. But the primary component of car noise at high-city and highway speeds is road noise transmitted through the tires. EVs use low rolling-resistance tires to improve range. Unfortunately, these use a harder rubber formulation and thinner tires, which increases road noise.

At low speed, the quietness of EVs is actually turning out to be a hazard, as it's harder for sight-impaired people, pedestrians, and cyclists to notice there's a car there.

The Chevy Volt will have some good sound deadening materials all over the body probably. That will deal with most of the noise inside the cabin of the car from the tires and engine. The engineers are saying that you can barely tell there is an IC engine running when it kicks in after the 40 miles in electric mode.

quote: I work 1.2 miles from my home, 5 days a week. I drive an extra ~160 miles a week for college, Costco, family, and misc. My fuel budget last year averaged almost $50/week...

What the hell are you driving, an Ares 5?

By your own estimate, you are driving less than 180 miles per week and spending $50/week on gas. Are you seriously spending $3.50/gallon and getting less than 13mpg?

Here's a suggestion: Never mind the Volt. Go buy a Honda Civic for about 1/3 the price of a Chevy Volt. They get 26mpg city, so your 180 miles per week should end up using less than 7 gallons of gas, which should cut your weekly fuel budget in half. Not only that, with the $20,000 you saved by NOT buying a Volt, you could buy somewhere north of 5,000 gallons of gas, which should last you for almost 14 years at your new 7 gal/week rate.

That's the other misleading thing about all this. The U.S. measures fuel efficiency in miles per gallon, which is backwards. The rest of the world uses liters per 100 km.

The problem with putting the fuel volume in the denominator is that it exaggerates the influence of more efficient vehicles. Switching from a 15 mpg SUV to a 30 mpg sedan saves twice as much gas as switching from a 30 mpg sedan to a 60 mpg hybrid. But the mpg ratings make it look like it's the other way around, with the biggest gain appearing to come from going from 30 mpg to 60 mpg.

Measured in liters per 100 km, the SUV would be 16 L/100km. Switching to the sedan would get you to 8 L/100km. Switching to the hybrid would get you to 4 L/100km. With the volume in the numerator where it should be, it's easy to see exactly how much gas you're using/saving.

It's an '02 Avalon, and even on its best days it does not get the mileage it "should". But since most of my driving is small-town, stop every quarter mile, crap, I do get 13-15 mpg on average. Even when I hit the highway it's high traffic for school, keeping my tops mileage around 22mpg.

Instead of screaming " zomg big oil !!! " conspiracies, can you actually point to any part of this study that's fraudulant or incorrect or biased in some way ? They are even taking into account the government subsidy.

By the way, let me clue you guys in. If the government has to offer such a huge subsidy on a product, that should tell you that the free market is NOT ready for the product.

You guys are talking about oil company bias, what about our own government ? Since when is it the job of the Government to help pay for your automotive purchase anyway ?

I dont know about the fact about the free market not ready for it. It seems to me that Car companies being in a Recession want to charge the Customer As much as possible for this so called new Tech. Then they also get a kick back from the Subsidy.

There are several thoughts that come to my mind. Firstly, electric cars are becoming viable because of the price of fuel, and since it is believed oil production has peaked and will now start to decline, then generally speaking one can expect the price of fuel to continue to rise. Thus owning a car will become more expensive.But is converting or replacing the current privately owned fleet the right option? Wouldn't a better option be to encourage public transport? A car of any sort places a cost on the public to support it, whether it is maintaining roads, providing parking at shopping malls or on the side of the road, or the effect on health of bystanders.By replacing the large privately owned fleet of cars with a large fleet of public transport, those costs will still exist, but will be lowered.Another option, which seems to be overlooked, is to convert sewage into fuel. Currently sewage is an expense to us. But sewage is also rich in hydro-carbons. It isn't by accident that 99% of our current vehicle fleet is run on liquid hydrocarbons. Liquids are so easy to handle, they give you flexibility in vehicle design, and it is easy to make a viable engine.By converting sewage into liquid fuel, it becomes an asset to us, not an expense. I seriously doubt we will all get a cheque from the city council instead of a bill every few months, but it will mean that instead of importing processed fuel and food and exporting cleaned up sewage and exhaust gases, a city will import food and export gases.

Seriously. The vast majority of the US is rural, and most metropolitan areas are sprawled 20 to 40 miles out from city hubs. Mass transit looks nice on paper and works well in small european countries, but not so well here.

For example, here in Charlotte we have one north/south light rail line that just opened a little over a year ago. Took billions to build, endless political BS, and land rights squabbles. They don't intend to have the west/east line in to my area until 2024.

Next, no high speed rail. Some A-hole politicians think high speed is an 80-90MPH Amtrak.

We have a country that is too large to logically do what you suggest with mass transit in a reasonable amount of time.

Population, sure. Land, no. Connecting urban cities requires a lot of rural area to cover. The exceptions are the Eastern seaboard - which is one giant megalopolis from Boston to Atlanta - and Los Angeles, which is a sprawling urban mold that would be nigh impossible - and certainly impractical - to link with commuter transportation.

Without a doubt, I agree a national system would be highly unlikely. That being said, many large cities in the US don't even have a suitable transit system which puts a lot of stress on existing infrastructure.

My point is 80% live in urban areas, a large percentage of than within large cities and metropolitan areas in which public transit is possible. Unfortunately cities have become so built up that its become increasingly hard to acquire the land needed for such a system in many places. That being said, it doesn't make it impossible and going forward it may be the only feasible solution.

quote: My point is 80% live in urban areas, a large percentage of than within large cities and metropolitan areas in which public transit is possible

And you'd still be wrong. While technically "urban", most US cities that currently lack strong public transit are simply too large to practically provide public transit to even ten percent of its residents. Los Angeles is the worst, and its numerous attempts at building subways or light rail have consistently fallen short of expectations. It is simply not feasible to turn a city built almost exclusively for car owners into one that uses public transit for any significant amount of transportation.

I just don't buy that, land, politics, price are all issues, the fact that a city is designed to use cars is not THE compelling reason. If there are no issues with the above, I see no reason why its not feasible. LA is a nightmare though I'll give you that, and I do agree that a giant hole has been dug that makes it extremely hard to get out of. That begin said, its barely feasible to drive around these days in LA with the the freeways and streets always being so crammed. Eventually something is going to be have to be done regardless.

Look, I have never paid more than $17K for a vehicle. I make between 50k and 100k a year, and simply cannot afford to drive a $40k vehicle. Give the average person a choice between a $40k Lexis/Mercedes/BMW and a Volt... guess which one wins? It's DOA due to the price.

You can't use it in the scorching heat and you can't use it in the freezing cold. That means that someone in Minnesota can use it in the summer, someone in Miami can use it in the winter. How does $40k for a part-time car sound? There will be a thin band of the U.S.... south of the snow cover line, north of the gnat line, in the Cities where short trips are the norm... where this MIGHT be useful. Are we going to get enough people in this thin band of the country to buy this car and make it profitable? NO!

With the federal tax credits, the 2011 Volt will probably cost you about $32,000. GM is also hinting that the price is likely to get closer to $30,000. Some states like Texas and California are also talking about additional tax incentives that might get the Volt to perhaps $27,000. Who knows?

There's also going to be other incentives like no emissions inspection fees, low vehicle taxes, HOV lane access, low or free parking, low or free charging, employer tax incentives, etc. This is going to make people driving 24 mpg gasoline cars very jealous and they'll want to get a Volt too. That's exactly what America needs! Like GW Bush said ... "we're addicted to oil"! Foreign oil fatcats and petrodictators have us "over a barrel" and can screw us any time they feel like it.

On top of all that, the Volt's maintenance expenses are expected to be pretty low since 80% of the people will rarely be using the IC engine since most people drive under 40 miles. Some employers will let people charge for free at work too. 80 miles a day is plenty for 99% of the people if they can charge at work. That IC engine might only come on a few times a year. That will be HUGE if gas prices go over $4/gallon like they were in 2008.

quote: With the federal tax credits, the 2011 Volt will probably cost you about $32,000. GM is also hinting that the price is likely to get closer to $30,000. Some states like Texas and California are also talking about additional tax incentives that might get the Volt to perhaps $27,000. Who knows?

Tax incentives only work during the early adoption phase of a product. Once it becomes mainstream, such tax incentives become prohibitively expensive. The average individual income tax return for FY2007 was $9800, which represented about 50% of gross federal receipts.

Say you figure in the future half the cars sold are EVs, on average each person who files a tax return gets a new car every 5 years, and the average tax incentive is $7500. Continuing the tax incentives would then cost 7.7% of total federal tax revenue. That would make it a bigger chunk of the budget than everything except Social Security, Medicare, welfare/unemployment, and Defense. Ain't gonna happen.

The hope is that the incentives will drive the technology enough that the cost of these vehicles will come down more in-line with ICE vehicles. As the vehicle becomes more popular, the tax incentives will disappear. Hopefully the price will come down at the same time due to manufacturing efficiencies. But you never know with subsidies.

I like the thought of a mini hybrid - fwd engine, small battery pack (supercapacitor?) and rear wheel motors. Hopefully this could give fully regenerative braking in appropriate conditions, 4 wheel drive in snow with an electronic diff lock, extra acceleration to allow more hooning away from the lights...

I like the idea of a two wheel vechicle with a 21-speed. Interestingly enough it works on calories, and has the added benefit of reducing the obesity problem here in the US. No infrastructure needed and you can get rid of foreign oil forever. The biggest problem is the limited speed at 10-20mph. Some of the better ones will hit 35mph, maybe 50 if you go downhill with the wind. However, the return trip will be nasty. San Francisco might have some issues, but Kansas or Iowa might fair pretty well.

Out of the whole report - there wasn't a mention about not having the infrastructure to support it? I see that as one of the largest detractors of future electric vehicles. As gas prices go up (which they will) - we still need to invest trillions in the powergrid to support EV's.

The current grid will EASILY support the first million or so electric cars. Plugging in a Volt overnight is about like plugging in a new dryer and HDTV to your house. Initial problems will be a LOCAL issue.

Some parts of the country like near Silicon Valley in California will probably have to upgrade their infrastructure soon because more people will probably buy electric cars in that area. If you don't live in an area with a high density of electric car buyers you'll have nothing to worry about for years. Probably like 2020 or so.

It's going to take a while for people to get used to electric cars. It could happen very fast though ... especially if gas prices go sky high again. It's going to be great for America's drivers to give the middle finger to Big Oil, Middle East fatcat oil shieks and Wall Street oil manipulators if they try to jack gas prices up sky high again.

Once the Volt is on the scene in 2011 ... the people will have the POWER OF CHOICE in how they get the energy to drive their cars. Just like you can choose different brands of cereal at the grocery store you will be able to choose your "fuel" ... and electricity will ALWAYS be cheaper than gasoline on a per mile basis.

B) The report does discuss the increase in electricity consumption and generally finds it to be negligible until at least 2020 because of relatively low adoption of ecars, and probably well past that if you accept their estimates of the economic infeasbility of e-cars.

quote: BCG suggests a number of things to make electric vehicles more palatable to the U.S. consumer with two of the more outrageous options being a 210 percent increase in the gas tax or oil prices skyrocketing to $375/barrel.

I can hear the green elites from Copenhagen already shouting with impunity "Make the U.S. pay for their planet abuse"!

This is a new technology. It will be expensive when it first hits the market. Early adopters are going to be the main purchasers. Plus this is not new technology in the home electronics market. It is in the automobile market. We are pushing the technology to get away from depending on foreign oil.

Anyone who is buying these cars because they want to make a difference in their pocket book are not that bright. Purchasing an electric car sooner rather than later is an investment into the future of America and into ending the rein of all the foreign oil tycoons. If investment is too strong of a word, try thinking of it as a donation to a charity.

I bet the cost of the Volt's battery will be about $4,000 by around 2013 once the huge battery factories get built and they refine all their processes and all that.

I hear these battery factories will be HIGHLY AUTOMATED. That means these factories will be similar to HDTV factories or maybe computer processor fabs. Expensive on the front end, but the products that come out of it will get cheaper over time.

Computers will be managing these battery factories mainly ... probably under dim lighting in order to save on electric bills. The raw materials will probably get cheaper too. More lithium mines will be opened, etc. There might be all new materials put in 2nd/3rd generation batteries that make them cheaper too. All these things add up and help keep costs lower. The so-called "experts" might be pretty embarrassed about their predictions in 5 years.

There's also PLENTY of lithium in Nevada I hear. More than enough to probably make about 20 million Volts probably. The lithium and the rest of the materials in the battery is also very much recyclable . Not with gasoline. The gasoline goes up in smoke and clogs up the atmosphere and pollutes the hell out of cities like LA and Beijing, China.

Toyota already is recycling the Prius a good bit. The scrap value for the Prius is pretty high because of the metals in the electric motor and in the battery. They'll pay you good money to give it back to them.

"Dealer Markup" with a limited production run in 2011 can you imagine how much the dealers are going to markup the Volt? It happened with the Prius 2nd Gen. If GM was smart & I know their not, GM would mandate the Volt cannot be marked up. If you want to pay for dealer options fine, but anything that cannot be removed from the vehicle (paint protection crap) cannot be added & therefore be marked up.

Or you could do nothing and let the market adjust itself? It's all about supply and demand, and if there are people (or idiots, as I like to call them) that have to have a Volt RIGHT NOW that they're willing to pay the markup, let them pay it. A fool and his money are quickly parted.

...and as far as I can tell this article doesn't even address power generation/distribution issues either.

EVs will eventually become viable. They're not now. Stop trying to shove them down our throats.

Biodiesel technologies that don't rely on dedicated cropland are apparently the vastly better option. Let's stop pretending that EVs are all rainbows and unicorns and actually work on attainable, economical technology.

I can currently go out and buy 15kWh of lithium ion batteries for a bit less than AU$7,000. I live in one of the most remote cities in the world so I reckon the manufacturers get them a bit cheaper than that.

Even being super conservative like the Volt, which only uses 50% of the battery capacity to prolong the battery life, and so would require a 30kWh pack for an actual 15kWh usable charge would cost me less than AU$14,000.

Apparently some people do grasp the paradox. As the Audi guy noted, paying people to buy your product is a pretty poor business plan.

In fact lets skip the middle man, (the fed's) and everyone who thinks the volt is a good idea can sbmit their names to a database of contributors. Those of us aware that the volt is a poor idea submit our names to the database heading of "F**K you i'm gonna subsidize your car purchase". Because we already subsidize so many things in society. Don't forget about the new health care.

How many people really believe the electric utilities won't jack up the rates significantly. They have got dividends, capital gains, bond/debt obligations. THEY ALSO HAVE TO PAY FOR THE NEW INFRASTRUCTURE NEEDED FOR CHARGING STATIONS.

That last one is the rational that will be used to hike the rates. Once again the feds have managed to stifle innovation by pandering to the oldigarchs.

I feel guilty even thinking it, but I do hope the volt flops terribly. No government should ever encourage so many eggs in one basket. This EV policy just hindered nat-gas vehicles, bio-fuel research, and all the oil not consumed in my engine is gonna be used to create the carbon-fibre body anyway, = NO NET GAIN.

Here is mine:Say battery costs 12 000 EUR and 1L of diesel costs 1 EUR and your car uses 6L of diesed to go 100km.This would mean that you need to go 200 000km for FREE for your battery to pay off.

Lets say you get electricity for free and you can go 200km on a single charge.This would mean that you need to charge your car 1000 times for your battery to pay off. But oops each charge degrades your battery a little, this means that you will need to do more that 1000 charges, in fact you will not have nerves after some 500 charges as you will not be able to do more that 50km on a single charge ;)

So basically your battery dos not pay off even if you get electricity for free ;)

Although many people dont consider it deeply. The real matter is cost of ownership over the life of the vehicle, which maybe 10yrs. a current quality levels. That number has to include the purchase price plus any incentives at the time of the sale. Unless you are looking at the future value of the entire system of production. If the cost of batteries drops from $16000 to $6000 in 10 yrs, thats good. That also means that $6000 in 10 years is worth a lot less that it does in present value.Buying a vehicle is often some balance of practical vs emotional value.If someone feels good about driving an electric or hybrid vehicle, for whatever reason then let them.They are willing to pay the cost for what they value.I personaly would like to see the cost of ownership on any vehicle be much less but we know this is business and where profit is involved the price will almost always go up. The only way around that is usually to buy a smaller, higher production vehicle than you currently use.The savings in electric/hybrid vehicles comes in the low cost of miles per kilowatt hour vs mile per gallon. Plus in the case of pure electrics, less cost in parts n repairs. Of course the main cost bump is the price of the batteries over the price of a gas vehicle.Pratically speaking if you only travel round trip to work of 20 miles/day, plus a few other stops thats 10k-12k miles a year. Ideal for a pure electric and you can charge car overnight while you sleep. If you need to drive to Grandmas house in the next state, drive your electric vehicle to an enterprise or hertz etc. and rent a gas car to go long distances.

I've had my primary vehicle now for just over 11 years since new. I know that if I top off the tank, I can drive 440 miles before my next fill up. Given that I live outside of a metropolitan area, and also need to travel outside of that area, investing in a 40 mile range EV would be insane. If my vehicle got wrecked at the 5 year mark, I could replace it with any old gas fired vehicle, and loss less value - Insurance always screws you on value anyway.

I highly doubt that the 40 mile range you get when new is relevant 5 years into ownership. What if the battery is only returning 25 to 30 miles after 5 years and GM says that it falls within spec and won't replace the battery at that point?

I buy my vehicles with the single intent to run them until they are near dead. The upfront purchase cost of an EV is actually though more painful than the ongoing cost of gas which a person can control via efficient trip planning. You can't change the higher car payment once you sign the paperwork. :)

An EV doesn't tow. You don't take into consideration that some buyers will have to upgrade the electric in their homes to ensure they have an outlet near the car or to have a 220volt outlet for faster charging if the EV supports that.

There are plenty of cars out now that get 40mpg or close enough to it that buying an EV like the Volt doesn't make any financial sense at all.

IF you want to be the cool kid with the latest thing then fine... go for it. If the idea of not buying gas for your car floats your boat, go for it. IF the idea of zero emissions at point of use makes you happy, then go for it.

I'd buy an EV when there is charging infrastructure everywhere, and when I can get 100 miles+ to a charge and when the vehicle has a price much closer in parity to it's gas powered cousins. I'd feel much more comfy today buying a natural gas powered vehicle than an EV.

All doom and gloom, eh? In your mind Brandon. If you were around in the horse and buggy days , instead of writing about the progress and possibilities of automobiles, you would be writing about how it will never happen and how bad it all is. Doom and Gloom man! Who are you working for anyway? I would be $50 somehow affiliated with the oil industry.

This writer is so unconscious that he has no awareness that the prevailing factor in electric is that they are cutting out emissions that are not good for the environment that we depend upon and are destroying. The only awareness is about money money money. Money is your god!

I'm in Australia and its normal to drive up to 50km to get to work. If it 30+ degrees celsius and you have the air conditioner on and stuck in traffic how long will the battery last.It is not practical here.And the electricity to charge battery has to come from somewhere. In Australia its coal.

The unacknowledeged fatal flaw of electrics is simple. Power is stored as electrons in batteries. An electron has a mass less than .001 of a proton or neutron, so batteries have to be massive to store enough electrons to furnish any substantial energy. Meanwhile, we/re wasting billions in the futile attempt to defy the laws of physics that ought to be obvious.

quote: The report suggest that consumers won't see a payback for the energy/fuel savings of all-electric vehicles for roughly 15 years. The upcoming Chevrolet Volt, however, fares even worse -- according to the BCG, the payback timeframe for the vehicle is a whopping 19 years.

So whats the payback time if I buy any other car? How is this calculated?

If they are calculating the savings of driving this car vs a standard gas car, well TELL THEM TO SHUT UP! If its saving you cash then, its saving you cash! Plus the possible side effect of helping the environment. Altho I think the jury is still out on that one.

The bigger question is, who buys a vehicle to return your investment (other than collector cars?) If I spend $40K on a Lexus, I will spend a certain amount on gas and other expenses over the life of the car, and then sell it at a depreciated amount. Likewise if I buy a Volt I will spend a certain amount on fuel and other expenses, and then sell it at a depreciated amount. With a Volt I will spend less on fuel. I doubt the battery pack will need replacement during the time I own the car. Plus I'll get another $7,500 back in cash.

So what's the issue? I didn't look, but I bet this is one of Jason's articles... right?

I think the point of the study was to note that the $7,500 tax credit won't last forever and that the price differential between an electric vehicle and a gasoline vehicle won't come down fast enough to offset that difference.

As for how they calculate their figures, I would like to know as well. But it's not that hard to imagine that a favorable comparison would be with a ~$16,000 Chevrolet Cruze vs a $40,000 Chevrolet Volt (pre-rebate) since the Cruze and Cobalt share a common platform.

That being said, it's basically the same argument leveled against hybrids in the beginning, except for that the price different is a LOT larger this time around because of the large amount of batteries being used

It's a good find and a good question. I took the facts to mean 10 years from now, the incentive needs to be in place.

The article was saying right now the price is not economical, but 10 years from now there will still be a $10K premium, thus the $7700 (or $7500) will make it more manageable and the payback time will be drastically reduced.

Nobody buys a vehicle to return their investment - however, the option is:buy a Volt for 40,000, pay as you go $1000 a year in gasoline and fuel, and $1000 a year in maintenanceOR:buy a similar car for 20,000, pay as you go $1500 a year in gasoline and $1500 a year in maintenanceAnd sell the cars after 10 years for whatever the resale value will be then.

If Volt can not make sense economically in this, then it is for people that want to buy it from non-financial reasons. As for the replacement of the battery pack, you could have to change it or not... based on all previous examples (Prius), you won't - but you can't be sure.

Also, there are still some issues in very cold or very hot places with Volt, so the car is certainly not for everyone.

You both bring good points, but I doubt the savings in gas will only be around 30% for car that can go up to 40 miles on electricity only.

There was research made to choose that figure, since most Americans commute 40 miles or less every day.

So if you spend $1500 in gas, but commute less that 40 miles a day, I'd expect your savings to be a lot more. Although, as the article points out, not enough to offset the difference in purchase price.

Technology does need to advance faster, but I think this is a good start. If I have the money I will purchase some form of alternative fuel vehicle. Whether it is an all electric, hybrid, or diesel will depend on how deep my pocket is when the time comes. :)

quote: First, the Chevy Volt battery pack is specified to be able to store 16 KWH of power.

Second, according to my electric bill, I pay 10.77 cents per KWH for electric supply plus 5.8 cents per KWH for electric delivery. This totals to 16.5 cents per KWH.

Next, to fully charge the Volt’s 16 KWH battery, I will have to supply it with 16 KWH of energy. This will cost me 16.5 cents X 16 KWH = $2.64.

Thus, it will cost me $2.64 to fully charge the Volt’s battery, that energy will allow the car to travel 40 miles.

So in conclusion, it will cost me $2.64 to travel 40 miles, which is roughly the cost of a gallon of gas, in a car that gets 40 mpg. If gas prices stay the same or go lower, it seems driving a Volt will be a financial wash.

Want to talk emissions? (This is just part)

Gasoline carbon content per gallon: 2,421 grams(src http://www.epa.gov/otaq/climate/420f05001.htm)coal per kwh: 800 to 1050 grams.Therefor that same 40 mile range from gasoline nets 2,421 grams while with electric power gets us 12,800 - 16,800 in the volt!! Dont get me started on battery disposal...

To entertain the electric vehicle as a viable option right now is nothing short of Naive. Its worse for the environment, financially a wash compared to gasoline, and more expensive initially.

Alternative energy can exist but the electric car is NOT the future of transportation, we are barking up the wrong tree.

You might not be ready to pay $12 for a loaf of bread but are you ready to start paying eight times as much for you fuel when oil prices go up?

Maintenance on an electric car is very low as it has very few serviceable parts - they are a much simpler system than an internal combustion engine. Hybrids could cost more though but the Volt should require less as it doesn't run the engine most of the time.

quote:quote:First, the Chevy Volt battery pack is specified to be able to store 16 KWH of power.

Second, according to my electric bill, I pay 10.77 cents per KWH for electric supply plus 5.8 cents per KWH for electric delivery. This totals to 16.5 cents per KWH.

Next, to fully charge the Volt’s 16 KWH battery, I will have to supply it with 16 KWH of energy. This will cost me 16.5 cents X 16 KWH = $2.64.

Thus, it will cost me $2.64 to fully charge the Volt’s battery, that energy will allow the car to travel 40 miles.

So in conclusion, it will cost me $2.64 to travel 40 miles, which is roughly the cost of a gallon of gas, in a car that gets 40 mpg. If gas prices stay the same or go lower, it seems driving a Volt will be a financial wash.

The Volt only uses 8KWH the other 8KWH is a buffer to increase battery life. So, it will only cost you $1.32 to fill up.

There are a lot less moving parts in a Chevy Volt that's for sure. The maintenance should be LESS for the Volt. The Volt is programmed to have the engine come on periodically to keep the IC engine lubed and the gasoline from getting stale. The gas tank will be sealed so even that will be a very minor issue.

People that run on the battery 90% of the time will probably only need to get minor maintenance every year or two ... mainly things like tires and brakes, etc. The IC engine simply won't need it if it rarely runs. Things like having to get expensive engine timing belts will be a thing of the past. The Volt has no transmission either. Those things can be very problematic and expensive you know.

I hear the GM engineers and designers are working very hard on the Volt. They're torture testing everything. In the cold in northern Canada, in the heat in Arizona, bumpy roads ... everything you can think of. And the Volt is passing every test with flying colors. The program is running AHEAD of schedule.

A 40 mpg average in anything other than a hybrid is very unlikely. Even if you lived close to the highway or hit every green light in town you'd be hard pressed to get 40 mpg average. Vice the Volt which will give you approx 40 miles regardless of highway commute or through town. The slower your commute the better the Volt gets.

Gas prices fluctuate much more than electricity does, so this argument works one day and can be weak the next. Not to mention the chances of gas prices going down vs up over time are as good as electricity prices doing the same. Neither are something I'd want to put money on.

It's also dependent on where you are. It's running much closer to $3/gallon (or even above in some places) around me right now.

The emissions numbers you provide are for carbon output. But is that for air emissions or just carbon waste produced? How much of that is CO or CO2 and how much is soot and particulate emissions that would be scrubbed and therefor not contribute to greenhouse gas emissions?

I agree these vehicles are going to be niche, and I think we are completely glossing over the environmental impact of producing and handling these new technologies to satisfy our green urge. But like any new technology it's not for everyone. People in urban settings benefit much more from vehicles like this than rural commuters. So them and the environmentalists will be first in line for vehicles like this.

I commute 10 miles/day round trip to work, with most of my trips to local stores no more than twice that, and less frequently. A Leaf type vehicle, even for more than an equivalent Fit-sized car is a nice option. I have another car for road trips.

Absolutely agree, and I know its more complicated I wanted to simplify it a little to make my point.

While you might say a car rated for 40mpg will get significantly less, I will rebut that the chevy volt is rated for 40 miles on the charge in the same respect to epa ratings. You will certainly get lower efficiency when you are on the throttle (drastically so) just like you would with a gasoline only based car. Its simply all about load. It takes more energy to accelerate quicker and no matter what that energy is sourced from a flatfoot driving style will decrease efficiency even before considering heat loss through battery quick charge.

This brings me to my next point addressed in the post after yours - this is assuming a 100% charging efficiency which we know will not be the case. How much is lost to heat we do not know but it wont be perfect.

Another consideration is that efficiency of batteries depends on operating environment- all batteries have a specific ideal temperature range. If they could easily get around that dilemma we wouldn't even need a "cold cranking amps" rating on automotive batteries.

Emissions numbers are just content figures from epa and similar - That's why I was mentioning it just as being part. I did not dig deeper than that. It made an excellent proof of concept as is and there are MANY MANY variables to sway for either party.

Actually your math on charge in is wrong. It may store 16 KWH of electricity, but charging is not a 100% efficient process. It would take you more than 16 KWH of power to full charge a 16KWH battery. How much we don't know as they probably have not published anything on charging efficiency, or published anything in regard to charging benchmarks other than charging time needed.

Also take into consideration the Cap and Trade bill that may become law, further increasing your electric bill and making EVs less attractive as an alternative method of transport. It would seem out own government is actually working against itself here in promoting something at the same time they seek to penalize you with their Ponzi Scheme Cap and Trade bill.

Price of watching young hip hoppers e-cars die at stop lights as they crank up their 500 watt sound system is priceless. Price of Sierra club wantabees freezing huttled up with ice inside their stalled drained e-cars is priceless.

Price of Sierra club wantabee that made it thru winter only to be sweating bullets with windows down and stalled again at the stop light is priceless.

While I agree with you will full electric vehicles like the Tesla Roadster or Nissan Leaf, that's not really a problem for a "range extender" like the Volt since it has a gasoline engine/generator as a backup.

BCG suggests a number of things to make electric vehicles more palatable to the U.S. consumer with two of the more outrageous options being a 210 percent increase in the gas tax or oil prices skyrocketing to $375/barrel.

I really don't like comments like these, cause for most of us middle, lower, or poor, gasoline vehicles are going to be it for us, so when I see someone saying to pose a gas tax, that's not going to get anyone, or atleast most in my circles to buy electric vehicles, what it's going to do is put most in the poor house even faster than the poor economy has that we have experienced the last 2 plus years, as everything we buy or services like like our energy, electric bills are tied to gas prices, & will raise them to levels most will not be able to pay, so this, I could be wrong about, but I think this would cause an ever greater divide from the classes, not make things better. I guess I can get over my dream of how do you keep gasoline prices down, cause that just doesn't seem possible, look at what's happening now with gas prices & energy prices going up cause it's cold.

For the electric car to be seen as a justified purchase, consumers would have to pay more money for gas. The research company was saying to achieve that difference the price of gas would have to go up astronomically, or the tax we pay on gas would go up astronomically. I don't believe he is advocating that taxes or prices should increase; however, if they do, then that is the point you should consider an electric vehicle.

For the electric car to be seen as a justified purchase, consumers would have to pay more money for gas. The research company was saying to achieve that difference the price of gas would have to go up astronomically, or the tax we pay on gas would go up astronomically. I don't believe he is advocating that taxes or prices should increase; however, if they do, then that is the point you should consider an electric vehicle.

I think I understood just fine but there are some who say this needs to happen to force people to buy the electric vehicles or make them, & hybrids more appealing to the masses. All I am saying is this would have the opposite effect on many. No matter how high gas prices get if someone is paying a note on their current car, they are not moving into another car & I really don't see the economy changing all that much for most in the next few years.

The point is it's not saving you cash. If you're spending $15K more than you would on the gas version and servicing the vehicle costs more money, then it's not saving you cash.

All it's saving is gas. Don't forget that some gas is spent in producing more electricity to fuel your car anyhow - electricity doesn't just magically appear in peoples' homes it is generated by nuclear, natural, and biological fuels. Gasoline is often used in transportation and generation when converting mass into energy.

The payback time is the time it takes to be considered cost-effective when compared to the gasoline alternative. If that point is 15 years, this is outrageous. A 5 year (and less) payback time would be the goal - an instantaneous payback time (0 years) would be ideal.

I've read it takes less electricity to power your electric car for 40 miles than it takes to make enough gasoline to power a gasoline car for 40 miles. Now add in the amount of energy it takes to run a gas station and the amount of energy it takes to distribute the gasoline to the various gas stations...

I'd rather put an 8kWH solar array on my roof and make more power than I consume in my house AND charge an EV a little.

The way I figure it is my 1999 CUV has used roughly $20K in gasoline since we bought it ~200K miles ago and my 1997 28 mpg convertible has burned through about $14K in gasoline over it's 170K miles. Except for the fact that these two four cylinder vehicles have reliably and safely delivered us to and from work for the past decade plus - I'm not sure when these vehicles will ever pay for themselves. Some quick math during $4 gasoline a year or two ago showed me than an EV that costs about $40K would pay itself at about the same time an 18 mpg SUV drove 200K miles. Now the question that remained was whether I could replace the battery cheaply enough. I don't have as much faithful in the Lithium batteries as I do the well tried and true and very recyclable NiMH batteries.Lastly I put ALOT of importance on not having to buy gasoline. That has a value to me too.

Actually some more quick math reveals that an 16 mpg vehicle consumes about $50K in gasoline over 200,000 miles at $4 per gallon. I use $4 per gallon because it might take me ten years to drive 200K miles and I'm confident that gasoline will keep climbing in price - perhaps very quickly as South America, China and India - among others begin to compete more and more with North America and Europe for resources like oil.A decade ago when we bought our CUV gasoline was about $1.65 or so. This spring we expect to see $3 - so it has nearly doubled. Assuming things stay linear that would point towards $6 gasoline at the end of the next decade assuming no new gasoline taxes are put into place and assuming that demand for gasoline doesn't cause the price to shoot upwards sharply (or commodity traders don't screw things up again). So I'd say using $4 gasoline in my figures is being generously cheap.Makes a $40K EV look more and more appealing even if a battery needed to be replaced along the way. Oh another key piece of info - 100 miles in an EV costs me about 35 kwh * 9 cents = $3.15 in electricity. Driving a 25 mpg vehicle that same distance at $3 per gallon of gasoline costs me about $12. Pocket the savings for a new battery some day.For folks coming to grips with their low income - think seriously about getting any debts paid and living close enough to walk, bike or bus your way to work. It ain't getting any cheaper. We chose about a decade ago to live in a small town where our commutes are less than eight miles each way. I can bicycle, I could walk in a bad pinch, or I can drive cheaply. I don't think that life will get any cheaper here in America. Expect more taxes as the gov't healthcare plan takes root and our gov't/personal debts acrue interest and/or the dollar falls in value on the world markets. I figure things will change alot starting in about 5 years.

quote: If you're spending $15K more than you would on the gas version and servicing the vehicle costs more money, then it's not saving you cash.

You are making a lot of assumptions.. You have no idea if it will cost more to service, in fact if you look at the Prius, this does not seem to be the case. Sure different technology as the Volt as it has the electric engine powering the vehicle, but still the same concept. There are also a lot less moving parts which is also a bonus. Really the verdict is still out on this one, new technology will most likely cost more to fix, but you really have no idea what the delta will be right now.

quote: The point is it's not saving you cash. All it's saving is gas.

And you buy gas with what exactly? Lucky charms? While it is certainly true that you are still paying for the electricity, as it currently stands it is still cheaper than going to the pump. Thats CASH savings, thus you ARE saving cash.

quote: The payback time is the time it takes to be considered cost-effective when compared to the gasoline alternative. If that point is 15 years, this is outrageous.

This assumes you keep the car throuhgout its lifetime, which is not exactly a common practice(it does happen but its not the majority). As I've posted previously, the resale value of the car will most likely stay higher because of expensive parts like the battery. This HAS to be taken into consideration, just the same as buying a Chevy Cobalt vs a say a Civic. A Civic will retain its resale value, as such the higher initial pricetag is worth it if you plan on selling your car down the line. (this does not even include the gas savings)

Whether the service cost is higher or not is irrelevant. The point is, you're spending $15000 more up front to purchase an EV with a battery pack versus the same car powered by gasoline. A quick look at an auto loan calculator shows about a $300/mo difference for a 5 year loan. A Honda Accord EX is roughly $25k versus the $40k for the Volt. With an EPA average fuel economy of 25 mpg, I would have to drive 2500(!) miles per month with gas at $3/gal to make up the difference. So how is buying an EV saving me CASH?

"Really the verdict is still out on this one, new technology will most likely cost more to fix, but you really have no idea what the delta will be right now. "

"as it currently stands"

"will most likely stay"

Difference, he is passing his post as fact, I'm not. I'm just putting it out there that you may have to take these variables into account. Whether or not my statements come true is yet to be seen, but to pass judgments based on an article that doesn't even show its calculations is just plain pointless.

quote: This assumes you keep the car throuhgout its lifetime, which is not exactly a common practice(it does happen but its not the majority). As I've posted previously, the resale value of the car will most likely stay higher because of expensive parts like the battery.

True, but you seem to forget higher priced cars tend to depreciate more. A $20k Toyota will hold its value much better (as a dollar amount) than a $30k Toyota, since they will both lose about the same percentage of their values, 50% of 30k is greater than 50% of 20k.I'd rather buy a small, simple, economical car like a Honda Fit, Civic, etc, than a Hybrid if I'm trying to save money.It makes more financial sense.

My first car was a Mazda Protege5, I could have bought a civic for exactly the same price at 21k (CAD). 4 years down the line when I went to sell my car, the resale value for my protege was ~10k, while the Civic for the same year for the comparable car was still in the ~15k range.

This had all to do with the car being a honda, it was known to be reliable, low on gas and as such had a higher resale value.

I'm not saying this will happen with cars like the Volt, but the potential is there. Even the Prius has a very high resale value for various reasons. Heck even compare two vehicles, say a Camry Hybrid vs a normal Camry and figure out the delta. You will notice that although the Hybrid had the higher initial pricetag, it also currently has a higher resale value.

To eliminate other variables, you should compare cars from the same manufacturer. So when you compare Camry Hybrid to Camry, of course Camry Hybrid has the higher resale value because it cost more in the first place! However, if the cost difference was $4k when they were brand new, it won't be $4k when they're used, it'll be less, which means the more expensive hybrid lost more dollar value compared to new.

Ratios! You can't do any calculation like this without taking them into account. As long as the non hybrid version drops at the same or higher rate than the hybrid model, you are not ending up with less. Yes the difference goes down as both models lose value, but unless the hybrid version depreciates at a faster rate than the non hybrid version, your cost ratios remain the same.

20k - 10% = 18k10k - 10% = 9k

Both still lost 10% of its value, both are still at 9/10th's of their original value.

You realize you just owned yourself right?Of course you are making more money :) You sell your house at 550k after 10 years vs. your friend at 275k, and you'll have 50k in your pocket and he will have 25k, assuming you bought the house outright of course. You made 50k while he made 25k.

Also 50% is 50%, regardless of initial price, the ratio remains the same. It doesn't matter if you bought a 100k car or a 20k car, 50% depreciation is 50% depreciation. Either way if you were to replace the car with the one of the same value, you would be paying 200% the resale price.

Since 50% is 50% regardless of price, why don't you give me 50% of 100k and I'll give you 50% of 20k in return, since they're the same, right? Hell I'll give you 100% of 20k, you're only giving 50% and getting back 100%, that's the deal of the decade for you!!!

I agree, the study itself is flawed. In fact because of the value of the battery (as they said in a bunch of years these batteries could still cost up to 6k) the resale value should be even higher compared to a gasoline equivalent.

They also don't show how they came up with their numbers. 15 years? compared to what? Where is the breakdown? Its barely even news worthy without these numbers.

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